WTI struggles with $ 47.50 amid potential impact of Harvey, N. Korea news

The recovery seen in oil futures on NYMEX ran into resistances located near $ 47.50 barrier once again, as oil markets remain on the edge, still assessing the implications of the Harvey Storm.

Hurricane Harvey that gripped the US over the last week led to a shutdown in the US oil production, while on the other hand, it reduced crude demand, as  almost a quarter of the entire US refining capacity was knocked-off.

Hence, the upside in the black gold appears capped amid dwindling crude demand from the US refineries. Meanwhile, the latest round of nuclear tests conducted by North Korea, also weigh down on the investors’ sentiment, in turn diminishing the demand for the risk asset oil.

Also, in an evidence of markets losing confidence in oil, the latest CFCT data showed that traders had cut their combined long futures and options position in NY and London by 105,377 contracts to 165,896 in the week to Aug. 29, the lowest level since late June.

United States CFTC Oil NC net positions down to 365.9K from previous 445.4K

In the week ahead, the commodity eagerly awaits the US weekly supply reports for fresh direction, as markets gradually look past Harvey hurricane. At the time of writing, WTI trades +0.30% higher at $47.42, while Brent drops -0.45% to $ 52.51.

WTI technical levels 

Higher side: $ 47.61 (50-DMA), $ 48 (round number), $ 48.75 (Aug 21 high)

Lower side: $ 47.12/04 (10 & 5-DMA), $ 46.56 (Sept 1 low), $ 46.15 (Aug 28 low)